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How to Create an Investment Platform

Feb 2, 2023
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17 min read
How to Create an Investment Platform
Iryna Meshchankina
Iryna Meshchankina
Operations Manager

With digitalization lowering the cost of financial services, even the largest and sternest industry players are considering digital fintech products. For investment companies, this usually means using an out-of-the-box solution to fix some issues in the existing system instead of custom-building an online investment platform.

Unfortunately, this approach to investment digitalization often backfires for two reasons. First, it’s highly inefficient to digitalize particular parts of the system while leaving the rest unchanged. Second, due to the differences in state regulation, there is no universal ready-made platform that would fit every investment company’s needs and processes.

But what does it take to create an investment platform that includes a website, a web app, or a mobile application? Continue reading to discover what to consider before creating an investment platform, what features it should have (based on the fintech projects we’ve developed), and how to calculate the investment platform development cost.

What to Consider When Developing an Investment Platform

Patrik Hansson, our client and founder of Swiss fintech startup Clear Minds, believes that building an investment platform primarily requires agility:

“For those who are just starting out the journey to build their own fintech, the best advice I can give is be agile; be fast; listen to the market; have your idea but do not be too attached to it: try it out and adapt. That is the key point if you really want to create a good solution for the market.”

And we agree. Additionally, you have to be clear about who your target audience is and whether the platform will be B2B or B2C.

Analyzing the audience is important because the architecture of the service depends on it. For instance, with B2B, it’s going to be more branched out and complicated.

However, the audience doesn’t influence every aspect of the development. Allow us to walk you through them all.
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1: Architecture

A thorough audience and market research allows developing your own value proposition, which, in turn, can help choose the right architecture for an investment platform. On top of that, fintech products usually require scalability, security, and compliance more than, say, ecommerce solutions, so their architecture needs to account for that.

Generally speaking, there are several architecture types we use most often, each with its pros and cons:

  • Layered architecture (aka, n-tier architecture) — easy to start with but hard to scale
  • Event-driven architecture — good scalability and performance but issues with eventual consistency
  • Microkernel architecture (aka, plugin architecture) — easy-to-add functionality thanks to plugins but difficult to design
  • Microservice architecture — great scalability but issues with designing and testing

Selecting an architecture type for a fintech project — or any software project, for that matter — is an important but complicated step that requires specific skills. That is why it’s best to leave it to a software architect who will carefully consider reliability, scalability, team composition, and other technical and business goals before making a decision.

2: Bank Integration

Naturally, fintech app or investment website development requires integrations with financial institutions. Without this, the product won’t be able to obtain financial information about customers, their balances, transactions, credit scores, and more.

In the case of an investment app we developed, integration allows users to receive their credit scores from banks after a short survey. Based on the data, every user gets a score that serves as a ground for investment suggestions.
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3: Country and Time Zone

The geography of an application is also an important factor to consider due to the varying regulations and operating hours of the banks integrated with the investment app. For instance, in England, banks only provide information Monday to Friday from 9 AM to 6 PM.

However, these restrictions don’t mean the application should not work on weekends. If, like us, you happened to encounter this inconvenience, you can make it seem invisible to the users by extracting data from the most recent updates. In that case, if a customer makes an investment inquiry on a Saturday, they will get the investment rates from Friday, even though they may have changed.

4: Code Logging

We’ve seen that third-party integrations are vital for proper code error logging, seeing what caused errors, and how to prevent them.

Here’s an example from our experience. The format of a third-party API changed, and the transactions weren’t going through anymore. But it wasn’t clear what the actual problem was because errors weren’t displayed correctly. This inspired us to create a tool for error logging that would log our every inquiry to the third party as well as its response to us. Now, when an error occurs, we see it in the log list.

5: Sandbox Environment

When choosing a third party or bank, make sure they have a sandbox option for safe code development. This will help to avoid accidental user information corruption or unwanted charges for using bank information.

What we mean by a sandbox environment is an exact copy of the third-party function set that connects to the source code without risking customer data. When you’re done coding, simply replace the sandbox URL with a real one.

6: User Flow Development

How do customers see your service from their perspective? It’s important to carefully plan the way your platform will interact with users. What steps do they have to take to get results? What should the registration, background check, and investment flow be? Discuss every user action and its detailed flow with an experienced development team.
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This is an example of the registration form for an investment platform we built. We had to leave some wiggle room in case the money didn’t go through or the investment didn’t take place on the same day for some reason. However, the next day’s exchange rates differ, resulting in a different investment outcome.

Still, we found a straightforward solution — restricted usage of the investment portfolio. This means that a certain amount of the client’s assets remains available at all times in case of exchange rate changes or transfer fees.
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We also took our time during user flow discussions to determine the best ways to notify users. Currently, there’s no need to check the website or app all the time to see the stock market status. Instead, the investment platform will send notifications if there’s a good opportunity to sell or buy.

7: Matching UX Design

User experience design for investment platforms is tricky for several reasons.

First, fintech solutions are notorious for gigantic tables and confusing graphs with all kinds of statistics and summaries. So it’s important to place this information in a digestible and easy-to-navigate form (especially for web and mobile apps).

Second, the registration forms of investment platforms can easily overwhelm first-time users. With 15 to 20 fields to fill in, no wonder clients do this in haste or don’t even make it to the final questions. This is a shame, considering that these answers are critical, and the system has to know as much as possible about its users for effective investment management.

However, a thoroughly designed UX can help mitigate this issue. Partially, it can be solved with third-party integrations, like with open banking, but this doesn’t make the form itself less intimidating. So UX designers have to get in the user’s shoes to create a flow that will be understandable, user-friendly, and easy to digest. Some ideas include breaking it up into several steps, putting the critical questions at the top, or gamifying the process.

We also shouldn’t forget about guides and hints for the users. They may not have the necessary experience or knowledge of certain fields or forms. So it’s important to keep the balance between giving enough advice and overloading the interface with pop-ups and notifications. Build an online investment platform you would enjoy using.
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A multi-language website or app may cause you trouble too. In our case, it was in English and German. We haven’t accounted for the length of German words, which are usually far more lengthy than in English, leading to some layout hiccups.

After considering the architecture, integrations, user flow, and other facets of investment platform development, it’s time to think about the features it should have.

The Main Features of Investment Platforms

We can roughly divide investment platform features into general and industry-specific.

The general features are the ones you would expect in all kinds of applications, not particularly fintech ones. They include:

  • Personal accounts to store all information about the user and their financial operations
  • Real-time alerts to never miss an important notification
  • Multi-platform support to have access to the platform regardless of the device
  • Analytics dashboards to see results and compare them to make investment decisions
  • 24/7 assistance to be able to instantly report any issues and get professional help, etc.

However, it’s more important to focus on the features that are inherent to investment platforms if you want to develop a really useful one. Here are the ones we recommend adding when creating an investment platform:

Multi-currency accounts

Multi-currency accounts make it easy to receive funds and withdraw cash whenever, wherever. With platforms striving to make investment markets more available to users, multi-currency accounts give them access to investment opportunities in various countries and currencies.

Unlike banks that have a limited number of the most popular currency exchange options, the multi-currency functionality in investment platforms allows exchanging all kinds of currencies. More than that, it does so much more quickly than a bank, with fewer fees and at a lower exchange rate since users can monitor exchange rates in real-time and choose the most appropriate time to convert.

Automated investment advice

Software’s ability to quickly and accurately analyze gigantic amounts of data makes it a worthy advisor when it comes to making investment decisions. Consequently, an automated investment advice feature will allow platform users to invest effectively.

This kind of advisor can assess the user’s investment portfolio in real-time, compare it to the market situation, and show the optimal time for selling assets. Alternatively, if users are considering investing assets, an automated advisor can predict how much they will earn from it in a year (and if it’s even possible).

Investment calculators

A handy feature, investment calculators show users how their investment will grow over a set period of time. They need this information to make better, data-based decisions.

For instance, a user may want to invest in quickly-growing, trending assets, believing they are “hot.” But the calculator doesn’t rely on emotions. Instead, it uses machine analysis and historical data to forecast earnings and objectively assess the profitability of an investment.

Cryptocurrency trading

If people are interested in investing, they are almost sure to be interested in cryptocurrencies. A fully functional investment platform should account for that and integrate with various cryptocurrency exchanges to allow buying and selling different kinds of coins.

However, cryptocurrency trading is illegal in some countries (China, Bangladesh, Egypt, and more). So we advise implementing this feature only if your audience lives in countries that allow it (Canada, Germany, Slovenia, Estonia, the Netherlands, Singapore, etc.)

Risk profile calculator

Risk profile calculators help determine optimal approaches to investing. Including questions the user can answer to see their risk tolerance will help them better understand what to invest into. However, it’s important not to overwhelm the user: five to ten questions will do.
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Savings goal analyzer

When users set their savings goals, it’s necessary to accurately calculate the probability of achieving them. This will also help them calculate the amount they would need to invest each month or so.

Investment portfolio health check

Introducing metrics like Standard Deviation or Sharpe Ratio to run the user’s investment portfolio health check will allow them to compare the difference between the actual user portfolio and the investment goal.

These are some of the features integrated into the investment platforms, apps, and websites developed by Django Stars. It doesn’t mean every feature on this list should be included, nor does it mean others can’t be added. In any case, it’s important to implement the features the audience expects and consider platform model specifics.

Investment Platform Models

The most general distinction includes B2B and B2C investment platforms. But they can also differ inside each group. The two most prominent investment platforms we developed in Django Stars were both B2C yet for different audiences.

Clear Minds was an intuitive app for private investment with a very straightforward workflow: users download the application, invest their money, and wait for the return.

But we also worked for GLASfunds — a complex alternative investment and operational platform that allows building custom private market portfolios. The platform collects capital calls from private companies and distributes them among registered investors for a single management fee.

To manage these and other operations, a system like this needs to have two portals:

  • for users to see capital calls from different companies and the statuses of their investments
  • for administrators to manage the process, send reports to investors, see how many investors committed and for what, who has transferred their money or not, and generally manage the entire process

This is what the administrator dashboard might look like:
How to Create an Investment Platform 7

How to Secure Data on an Investment Platform?

The security of a complex system depends on the weakest link in each subsystem. This means data should be protected on all levels of an investment platform, website, web or mobile app.

For instance, it’s important to always use the latest TLS protocol (currently, it’s 1.3) to secure a website. It will ensure the secure encryption of data passed through the public network to the client’s browser. By the way, TLS 1.3 uses AES encryption with a 128- or 256-bit-long key, which is the gold standard in the industry.

But none of this matters if the authorization and authentication processes are vulnerable. Simply put, it’s critical to protect investment platform users from their own actions. There are a number of ways to improve security on top of the standard login/password flow. The first thing necessary to add is two-step authentication. Depending on the user’s device, it could be a phone call, a text message, an authorization app, or biometrics (fingerprint, Face ID, etc.).

To go even further, it’s a good idea to allow users to manage active sessions opened from different devices. Adding an access or session log could help the tech support team or the user pinpoint fraudulent activity. In more innovative investment platforms, intellectual systems based on AI can do this instead.

If an investment app allows sharing data or giving limited access to third parties like consultants or accountants, it will benefit greatly from granular access control as well as a detailed audit trail.

During the development process, the security of the source code, infrastructure configurations, and cloud resources is crucial as well. All code repositories have to be protected using the RSA cryptosystem, two-factor authentication for developers, secure password policies, and robust access control.

Trusting the development team is also important.

For instance, Django Stars is ISO/IEC 27001 certified, which means clients can rest assured that we know how to protect data from cybercrime, breaches, vandalism, damage, theft, and more.

In the words of Oleksandr Ryabtsev, our backend competency lead, Django Stars controls security on various levels during development:

  • The code level. Following the SAST testing methodology, we make sure the code doesn’t contain errors that could make it vulnerable.
  • The third-party app level. We ensure that all third-party services we integrate are up to date on their fixes.
  • The deployment level. Our DevOps engineers make sure the cloud servers we deploy software to don’t have OS-level issues.

All in all, a tech team with expertise in fintech development will be most suitable for building an investment platform according to industry standards and security requirements.

How Much Does It Cost to Create Your Own Investment Platform?

The investment platform development cost varies greatly depending on the specific requirements and features requested. However, based on our general estimates for product development, it can take a minimum of 200 man-days to develop an investment platform from start to finish.

However, It’s impossible to accurately estimate the cost of development without genuinely understanding the scope of work. Factors that can affect the cost of development include the complexity of the platform, the number of integrations required. Will it be MVP development, refactoring, scaling, or does the client need to expand on the previously developed MVP? Each of these requests differs in the scope of work and, consequently, price.

Functionality is another issue that adds to the cost of the development. Depending on the goals of the project at a particular stage of development, features will vary as well. An investment app that’s just a concept to be shown to investors will have different features from a POC. Not to mention, different software vendors have different prices.

Ultimately, the cost of developing an investment platform will be unique to each project and will depend on the specific needs and goals of the client. Therefore, the best way to find out the cost of building an online investment platform is to ask.

If you contact us, Django Stars’ experts will interview you to determine project details and give you an estimate. After all, we’ve developed over 20 fintech applications and have some tips and tricks up our sleeves.

Our Advice on Investment Platform Development

After delivering an investment platform for the Swiss market, a SaaS investment platform, and numerous other fintech projects, we’ve learned how to make the development process smooth the hard way.

Here are the tips from our hands-on experience you are welcome to use:

  • Provide the specifications and business logic of the future investment platform in formulas with very specific examples.
  • Skip the complicated business talk and describe the requirements in a simple manner so that the team could quickly and easily understand what should be done.
  • Remember that though engineers may have experience creating investment apps or websites, they aren’t fintech experts. So it’s a good idea to provide them with simple and logical formulas and algorithms to calculate investor reliability coefficients depending on their portfolio. The same goes for calculating customer risks – time of deposit, primary investments, and so on.
  • Ensure that every team member is on the same page about the project. To avoid mix-ups in terms and their meanings, compile a dictionary where every term is explained. Consider conducting workshops for the development teams to explain the business logic and functions of the solution.
  • Don’t hold back on testing costs because users will lose trust in your platform with every bug or glitch they encounter. In the case of investment solutions, it’s critical to pay special attention and test the formulas that calculate investment risks, distribute the portfolio, etc. Because sometimes formulas that work well on paper or in MS Excel don’t perform as well in code.

We have plenty more tips on the architecture, data analysis, API integrations, and the UI/UX of investment platforms. If you would like to hear them and tell us about your fintech ideas, don’t hesitate to contact us.

Summary

Investment apps are a hit thanks to no minimum investment amount, but they need to follow specific guidelines to catch the attention and earn the trust of users.

So if you are thinking about how to create an investment platform, consider its architecture, integrations, geography, user flow, and experience first. Then, together with the tech team, discuss the features you want to see in the platform and whether they’re easy to implement or not. Finally, make sure that the team knows how to secure user data in the investment app according to the latest industry standards.

Building an online investment platform is no easy feat — working with sensitive matters like finances never is. That is why we recommend cooperating with a software development partner that specializes in creating fintech solutions. Investing in their experience can become one of the best business decisions you make.

Thank you for your message. We’ll contact you shortly.
Frequently Asked Questions
What countries are ready for online investing?
Countries that don’t set a minimum investment amount or the ones where this threshold is reachable for an average person. The US has numerous options for individual investors to buy stocks, from online buying to investment clubs and hedge funds. At the same time, other countries like the UAE, the UK, Singapore, the Netherlands, Malaysia, Australia, Canada, and Hong Kong have loyal legislation for fintech products.
How does an investment management platform work?
Usually, customers register and fill in their information, based on which the service determines the asset classes and markets most appropriate for them to invest, be it real estate, materials, etc. When the choice is made, the system regularly conducts health checks of the customer’s investment portfolio by matching investment results with the set goals. Based on this, the customer gets suggestions on whether it’s profitable to keep investing or it’s better to pull out and wait.
Can I hire investment platform developers from DjangoStars?
Absolutely! We have ten years of experience creating investment platforms for the US, UK, and Swiss markets and will be happy to build one for you. We work with Fortune 500 companies, are a top B2B company on Clutch, and our processes are ISO certified. Contact us to learn the details.

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